Is the entity a childlike being?
I have thought about this for a while. I remember the devs saying that the entity recreates what it sees from the real world outside its realm, but doesn't necessarily have an understanding as to what they are. The entity understands concepts like, hope, fear, life, death, and pain. As well as hunger. Yet, it can't separate fiction from reality as seen with the existence of movie characters in the fog. The entity also seems to care little for morality as well, but does exhibit a base understanding of fairness. This can be seen by the entity allowing survivors to have tools and gain skills and understanding of its realm.